Updated January 19th, 2024 at 19:30 IST
Ford cuts production of F-150 Lightning pickup truck
Ford said that approximately 1,400 workers at the Michigan Rouge Electric Vehicle Center would be affected by the decision.
Ford Motor announced on Friday its decision to reduce production of the F-150 Lightning pickup truck. The No. 2 US automaker disclosed plans to scale back operations at its Michigan Rouge Electric Vehicle Center to a single shift starting April 1, marking a continuation of adjustments made in October when one of three shifts was temporarily cut at the facility dedicated to producing the electric F-150 Lightning.
The move reflects a broader trend of weakening demand for EV trucks, with General Motors also postponing the opening of a $4 billion electric truck plant in Michigan by a year in October. Ford had informed suppliers in December that it intended to manufacture approximately 1,600 F-150 Lightning EV trucks per week from January, a significant reduction from the initial plan of 3,200 units.
The production cut is accompanied by concerns from Detroit automakers, who argue that the Biden Administration's proposals to enforce emissions rules may lead to an excessive shift toward EVs, projecting that 67 per cent of all new vehicles in 2032 could be electric.
Ford said that approximately 1,400 workers at the Michigan Rouge Electric Vehicle Center would be affected by the decision. About 700 employees are expected to transition to the Michigan Assembly Plant, while others will be reassigned within the Rouge Complex, other Michigan facilities, or opt for a special retirement program.
Despite the production adjustment, Ford envisions continued global growth in EV sales in 2024, albeit at a pace "less than anticipated." Notably, a limited number of employees at component plants supporting F-150 Lightning production may also face impacts.
In October, Ford reported an estimated loss of $36,000 on each of the 36,000 EVs delivered to dealers in the third quarter. As a response, the company announced a slowdown in the ramp-up of money-losing EVs, redirecting investments to Ford's commercial vehicle unit and emphasizing plans to quadruple sales of gas-electric hybrids over the next five years.
In a strategic pivot, legacy car manufacturers, including Ford, have sharpened their focus on hybrid models over the past year. This shift aligns with changing consumer preferences, as hybrid models have gained popularity in lieu of all-electric alternatives.
On a positive note, despite the cutbacks in the electric vehicle segment, Ford disclosed plans to add a third shift and create nearly 900 jobs at its Michigan assembly plant, aiming to boost production of Bronco SUVs and Ranger pickups.
(With Reuters inputs)
Published January 19th, 2024 at 19:30 IST